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16.9.2011 Official
Journal
of
the
European
Union L
240/11
COUNCIL IMPLEMENTING DECISION
of 2 September 2011
amending Implementing Decision 2011/77/EU on granting Union financial assistance to Ireland
(2011/542/EU)
THE COUNCIL OF THE EUROPEAN UNION,
(4) The
Irish
authorities
have
indicated
that
there
are
very
realistic prospects, based on the results of the Liability
Management Exercises (LME) conducted thus far, to
secure a further EUR 0,51
billion private sector-
Having regard to the Treaty on the Functioning of the European
contribution to the recapitalisation of Bank of Ireland
Union,
by 31 December 2011. In light of the already large
public cost of the bank recapitalisation, and given the
conservative approach used to determine Bank of
Having regard to Council Regulation (EU) No 407/2010 of
Ireland’s recapitalisation need, it is now deemed
11 May 2010 establishing a European financial stabilisation
unnecessary and indeed inappropriate for Ireland to
mechanism ( 1 ), and in particular Article 3(2) thereof,
inject that amount of EUR 0,51 billion in advance of
the completion of further private sector-contributions
in order to meet the programme deadline, as doing so
would result in higher than needed fiscal cost and an
Having regard to the proposal from the European Commission,
unnecessarily high capital adequacy ratio for Bank of
Ireland once the proceeds from the further private
sector-contribution become available. The deadline for
Whereas:
the completion of this part of the recapitalisation of
Bank of Ireland has been reset to end 2011.
(1) Upon
a
request
by
Ireland,
the
Council
granted
financial (5) In
light
of
these
developments,
Implementing
Decision
assistance to it (Implementing Decision 2011/77/EU ( 2 ))
2011/77/EU should be amended,
in support of a strong economic and financial reform
programme aiming at restoring confidence, enabling
the return of the economy to sustainable growth, and
HAS ADOPTED THIS DECISION:
safeguarding financial stability in Ireland, the euro area
and the Union.
Article 1
Implementing Decision 2011/77/EU is amended as follows:
(2) In
line
with
Article
3(9)
of
Implementing
Decision
2011/77/EU, the Commission, together with the Inter
national Monetary Fund (IMF) and in liaison with the
(1) Article 1(3) is replaced by the following:
European Central Bank (ECB), has conducted the third
review of the Irish authorities’ progress on the implemen
tation of the agreed measures as well as of the effec
‘3. The
Union
financial
assistance
shall
be
made
available
tiveness and economic and social impact of the agreed
by the Commission to Ireland in a maximum of 13
measures.
instalments. An instalment may be disbursed in one or
several tranches. The maturities of the tranches under the
first and third instalments may be longer than the
maximum average maturity referred to in paragraph 1. In
(3) Under
the
Commission’s
current
projections
for
nominal
such cases, the maturities of further tranches shall be set so
GDP growth (1,1 % in 2011, 2,8 % in 2012 and 3,8 % in
that the maximum average maturity referred to in paragraph
2013), the fiscal adjustment path is in line with the
1 be achieved once all instalments have been disbursed.’;
Council Recommendation to Ireland of 7 December
2010 pursuant to Article 126(7) of the Treaty and is
consistent with a path for the debt-to-GDP ratio of
(2) Article 3(7) is amended as follows:
109,9 % in 2011, 116,2 % in 2012 and 119,4 % in
2013. The debt to GDP ratio would peak in 2013 and
be placed on a declining path thereafter, assuming further
(a) point (g) is replaced by the following:
progress in the reduction of the deficit. Debt dynamics
are affected by several below-the-line operations,
including capital injection into banks in 2011 with net
‘(g) the recapitalisation of the domestic banks by end
debt-increasing effect of around 6 percentage points of
July 2011 (subject to appropriate adjustment for
GDP, an assumption to maintain high cash reserves, and
expected asset sales and liability management
differences between accrued and cash interest payments.
exercises in the cases of Irish Life & Permanent
and Bank of Ireland) in line with the findings of
( 1 ) OJ L 118, 12.5.2010, p. 1.
the 2011 Prudential Liquidity Assessment Review
( 2 ) OJ L 30, 4.2.2011, p. 34.
(PLAR) and Prudential Capital Assessment Review

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L 240/12
EN
Official Journal of the European Union
16.9.2011
(PCAR), as announced by the Central Bank of
(t) the publication by the Central Bank of Ireland, by
Ireland on 31 March 2011. To allow further
end December 2011, of new guidelines for the
burden sharing, the final EUR 0,51 billion step in
valuation of collateral for bank loans;
recapitalising Bank of Ireland will be completed by
end 2011 and any further recapitalisation of Irish
Life & Permanent will be completed following the
(u) the preparation and discussion, by end December
disposal of the insurance arm.’;
2011, of a draft programme of asset disposals,
including the identification of the potential assets
to be disposed, any necessary regulatory changes,
(b) the following points are added:
and a timetable for implementation.’.
‘(q) the submission to the Dáil, by end October, of a
Pre-Budget Outlook setting out a medium-term
Article 2
fiscal consolidation plan for 2012-15 outlining the
overall composition of revenue and expenditure
This Decision is addressed to Ireland.
adjustments for each year, consistent with the
targets set out in the Council Recommendation of
Article 3
7 December 2010;
This Decision shall be published in the Official Journal of the
(r) the announcement, by 2012 Budget day (early
European Union.
December 2011), of binding medium-term expen
diture cash ceilings and set out revenue and expen
diture measures to deliver the needed adjustment
Done at Brussels, 2 September 2011.
over 2012-15;
(s) the issuance by the Central Bank of Ireland, by end
For the Council
December 2011, of guidance to banks for the recog
nition of accounting losses incurred in their loan
The President
book;
M. DOWGIELEWICZ

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